At the Mobile World Congress (MWC 2014) in Barcelona, MasterCard and technology company Syniverse announced Tuesday their alliance to develop an opt-in credit card service for travelers. The system will enable credit card transactions when users have their mobile device switched to that particular destination.

A pilot phase of such a service is in progress. The purpose, the companies said, is to avoid cards being used without the owner's knowledge, or having transactions unnecessarily declined when abroad. The companies said that 50 percent to 80 percent of declined transactions abroad are actually legitimate.

The service also offers prepaid data packages that travelers can buy from their phones when they hit a foreign destination. The companies noted that 70 percent of travelers switch off data reception when they arrive in another country, most likely to avoid roaming charges.

75 Million Mobile Phone Owners

Every month, 75 million mobile phone owners travel outside their home country, and data connectivity is obviously essential if geo-verified mobile payment is going to be offered in non-local destinations.

Also on the drawing board: the ability for MasterCard and Syniverse to target offers to mobile users, if their geolocating function is turned on. A Syniverse-commissioned report found that the market for "mobile context" -- brand-based services targeted at opted-in subscribers' information, behavior and location -- could be as large as $44 billion.

Geotagging is a key aspect of this new, pay-when-you're-abroad service, allowing mobile users to be authorized when they're in a new country, as well as enabling appropriate for-the-moment data plans and relevant marketing services. But it's geotagging that knows your mobile device and your credit card are in the same physical location.

The companies said that, "when your card and your mobile device are in the same place, you're less likely to encounter the frustrations associated with unqualified card cancellations or blocked transactions."

In-App Payments

Hany Fam, president of Global Strategic Alliances at MasterCard, said in a statement that "the speed and intelligence of our global network," combined with geo-locating solutions, can enable a MasterCard to work when a user and his phone are together. Syniverse President and CEO Jeff Gordon told news media that "the next growth phase of mobile is through the expansion of the diverse players within the ecosystem."

The two organizations process a massive amount of mobile data. MasterCard said it handles 65,000 transactions every minute, while Syniverse said it has relationships with more than a thousand mobile network operators, reaching 5 billion mobile devices globally. Syniverse is a global company that provides technology services for telecommunications providers.

MasterCard also announced at the Barcelona show the launch of in-app payments using its credit cards, which it noted eliminates the need for users to store bank card information across apps. The credit card giant also announced a series of alliances with other companies to simplify mobile payments with mobile devices, including Deutsche Telekom, Vodafone and Bank Audi.